Two women related to Zetas' boss plead guilty in money laundering

Updated 10:58 am, Monday, April 1, 2013

AUSTIN — Two women related to the feared leader of the Zetas drug cartel pleaded guilty to money laundering charges Friday in a federal courtroom here.

The pleas were part of a case that has made public allegations of the cartel's brutality, its strong presence in U.S. horse racing circles and its ability to corrupt politicians in Mexico.

Zulema Treviño pleaded guilty to one count of money laundering conspiracy, admitting that from 2008 to 2012, she helped her husband, José Treviño Morales, launder millions of dollars of the gang's money through a quarter horse breeding and racing operation.

Her daughter Alexandra Garcia Treviño pleaded guilty to one count of misprision of a felony, admitting she knew about the money laundering scheme and didn't alert authorities.

Prosecutors recommended both women receive probation. In court, Assistant U.S. Attorney Douglas Gardner stressed that neither had agreed to cooperate with the government. Afterward, neither woman would comment.

“It's a very difficult situation to be born into the family,” said Frank Ivy, Alexandra Treviño's lawyer. “She's doing the best she can.”

José Treviño is the brother of Zetas leader Miguel Treviño Morales, known in Mexico and along the South Texas border by his radio call sign, “El 40.”

The four Treviños are among 19 people charged in what prosecutors said was a multimillion-dollar scheme by El 40 and his brothers to launder the proceeds of their drug trafficking and extortion.

José Treviño is accused of being the front man, laundering El 40's and another brother's drug proceeds in quarter horses they trained and raced across the American Southwest.

Since José and Zulema Treviño and more than a dozen others were arrested in a multistate sweep in July, prosecutors have introduced through court filings and witness testimony evidence related to the gang's other alleged activities.

Members of the Zetas used drug money to pay off the gatekeepers at the 2010 All American Futurity at Ruidoso Downs in New Mexico, a premier quarter horse racing event with a $1 million purse, an Internal Revenue Service agent testified in July.

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“Our position is we've extensively reviewed the start of that race and stand by the legitimacy of the start of that race,” said Ty Wyant, a spokesman for Ruidoso Downs.

Another Treviño brother, Omar, known by his call sign “El 42” and like El 40, a fugitive in Mexico, would kill opponents who beat him in horse races and cock fights, according to a search warrant affidavit.

Investigators allege that one co-defendant, Francisco Colorado Cessa, a businessman in the Mexican oil industry from the Gulf Coast state of Veracruz, acted as an intermediary between that state's former governor and one of the founding members of the Zetas, a group that has gone from a hit squad of former Mexican special forces soldiers to one of the country's largest organized crime syndicates with a strong presence beyond its borders.

The campaign of Fidel Herrera, who was governor of Veracruz from 2004 to 2010, was funded by founding Zetas member Efraín “Z 14” Torres, FBI Agent Scott Lawson testified in a July 25 hearing.

“We have a confidential informant who can place Mr. Cessa as intermediary between Mr. Fidel Herrera and Zeta 14,” Lawson testified.

“At no time was any contribution made to my campaign or to my party,” he wrote in an email. “It's equally false that a supposed 'meeting' with members of this band of criminals was recorded in the governor's public activity log.”

Colorado Cessa and José Treviño have pleaded not guilty to the charges against them. Colorado Cessa's attorney denied his client had broken any laws.

“He's a very successful and extremely well-respected businessman in Mexico,” said Houston lawyer Mike DeGeurin.

Torres, who was one of the original special forces soldiers who helped form the Zetas as an assassin squad for the Gulf Cartel in the late 1990s, was killed at a horse race in Veracruz in 2007. After his death, the Treviño brothers hired Torres's horse trainer.

In a 2009 online chat with her then-boyfriend that were entered into the court record, Alexandra Garcia Treviño spoke excitedly of her family's prospects.

“I know my family isn't perfect,” she wrote. “But we are hard workers.”

Prosecutors alleged that after winning one race, she and her brother posed for a picture holding up hand signs showing their uncles' radio call signs.

As part of the plea deal, Zulema Treviño gave up her rights to the hundreds of horses she and her husband's companies owned, many of which were auctioned off last year, and ranch properties they own in Oklahoma.

She will be able to keep the modest home they own in the Balch Springs suburb of Dallas, prosecutors said during Friday's court proceedings.

The allegations against José Treviño shook the quarter horse racing world. He has not shied away from the spotlight, giving interviews after his horses won.

Julianna Holt, who along with husband Peter are majority owners of the San Antonio Spurs, had sold Treviño one of her horses. She bought it back at the government auction last year for $1 million.